WindowOn... Shopper StockTake 2021: Shocks & Switches by Shoppercentric

Because turning shoppers into buyers matters

StockTake 2021

Shocks & Switches: predicting what’s sticking

Brought to you by

www.shoppercentric.com

CORE SHOPPER BLUEPRINT

TRENDS

ISSUE

This report is based on online interviews amongst a nationally representative sample of UK shoppers aged 18+. Over 1000 respondents were interviewed for each wave. Fieldwork focusing on the impact of the pandemic was conducted in May, June and again in December 2020 and supplemented with qualitative online interviews with the same 20 people at intervals through the period of the pandemic. Many Shoppercentric Stocktake measures, however, go back to 2016 and allow further interpretation of pre- and postCOVID trends.

TRENDS TRENDS

ISSUE ISSUE No.51 No.51 PUBLISHED BY: Shoppercentric EDITOR: Tim Baker DESIGN: Mike Higgs

e: mikehiggs@mac.com We welcome ideas for future articles and reports. Guidelines on our preferred format and style are available from info@shoppercentric.com

All copyright is vested in Shoppercentric unless expressly stated otherwise. No permission is granted for reproduction, use or adaptation of the material, save as to provide for under Statute, and any such use must be accompanied by the appropriate accreditation.

Because turning shoppers into buyers matters

Welcome... Jamie Rayner,

Managing Director, Shoppercentric

Not Business as Usual Even if your business has been asymptomatic. In finalising each WindowOn edition, I am always curious to take a peek at last year to see if any predictions materialised. We did write “it’s all very VUCA” [volatile, uncertain, complex and ambiguous] in our opener and as we have sadly learnt, it turns out that we, and probably many others, grossly underestimated what a truly VUCA world would bring us. Over this past 10 months, as a Shopper Behaviour Agency, we have stretched ourselves to not only understand what has happened but also what behaviours are likely to remain. In shopping terms, our brains have gone into cognitive overload to make sense of today’s shopper. We have re-written our methodology rule book, created new ways to investigate behaviour and focused in areas of shopper insight that hitherto received only lip-service. We are thankful to our clients, our partner network and the dedicated Shoppercentric team for a full on, creative and productive year. We are delighted to be able to continue our journey with our 51st WindowOn edition as we draw our learnings from three waves of quantitative and qualitative data collected since StockTake 2020. Despite the epic turn of events this year, one quote has remained with me: “The most reliable way of predicting the future is to create it yourself.” Whilst there is some debate as to who the original author was, it is a great way to think about the challenge of how to win as new shopper scripts are being chiseled out, right here, right now. Someone will own them. Make sure it is you.

TRENDS Please contact us if you wish for more, we have plenty more insights to share from StockTake 2021

ISSUE Wishing you well and stay safe in 2021.

Trends Research... Money’s too tight to mention... again

Generation Change

So, how good does TikTok taste?

To treat or retreat?

Who loses when online wins?

Are Shoppers More Planned in their Behaviour?

What is Loyalty Anyway?

Shocks & Switches:

An Expert’s view Great Balls of Fire

Proud to Announce:

Client Space:

Shoppertalk

Anxiety and Struggle among the hardest hit How the youngest generation’s shopper behaviours are being shaped by the pandemic

Could the digital age help feed the nation’s appetite?

How important is spoiling ourselves in this complicated new world we live in?

Changing dynamics in grocery shopping

Or is there more opportunity to drive impulsive behaviour? Health issues around loyalty highlights the overarching impact that habit can hold.

We take a look at how we understand if changes are here to stay.

What can FMCG learn from the music industry in the post-COVID world? Voices4All

MARS’ #HereToBeHeard campaign

The Last Word

Money’s too tight to mention... again Anxiety and Struggle among the hardest hit How are your finances today? Were you expecting a big crash which hasn’t happened? Did you plan for events that have come to pass? Or are you coming through relatively unscathed? How many people out there are like you? Figure 1 The proportion of shoppers unaffected, planning for change or already struggling financially differs from the 2009 Credit Crunch (so far!).

Written by Tim Baker tim@shoppercentric.com When it comes to finances, our data is remarkably stable through 2020 and identifies four key types of impact that have been experienced. Interestingly, this is in marked contrast to the 2009 Credit Crunch and expectations in 2017 following the Brexit referendum. This time, half the population have experienced little or no negative impact on their finances: a third (33%) of the population claim to be unaffected by the current situation, while around a fifth (18%) say they are planning in the expectation of a hit. The ‘Unaffected’ group has increased by 5% during the course of 2020 while ‘Planners’ have reduced by 2%, suggesting some may have been more prudent than they now feel was necessary. % UNAFFECTED

15 20

% PLANNERS (CUTTING BACK JUST IN CASE)

% SOFT REACTORS (HAVING TO MAKE SMALL CHANGES) % STRONG REACTORS (STRUGGLING FINANCIALLY)

2009

CREDIT CRUNCH

2017

BREXIT

Shopper Trends No.51 | StockTake 2021

2020 MAY

2020 JUNE

2020 DEC

I’m actually better off. I’m not going out, buying clothes or using the car. More petrol has evaporated than I’m using! I’m saving money and have paid off a lot of my mortgage. The other half of the population splits almost evenly between ‘Soft Reactors’ (having to make small changes – 26%) and ‘Strong Reactors’ (hit us hard / had to make major changes – 24%). The proportion of Strong Reactors has remained stable, suggesting these hits came early on in the pandemic. As support schemes unwind the risk is that Planners will become Strong Reactors. Currently a ¼ of the population with the prospect of rising to perhaps 1/3, it is this group that will likely have a significant impact on the recovery. Figure 2 The pandemic has had greater financial impact amongst the younger age groups.

31 29

17 29

31 21

18 7

18/24

24/34

35/44

45/54

55/64

65+

One implication of this has been a greater focus on careful shopping and control of spending; Strong Reactors are more likely to be going out of their way to find the best prices, and splitting their shopping across multiple retailers in an effort to find the best deals. Not surprisingly, promotions are also relatively important: Strong Reactors in particular have noticed fewer and fewer promotions they can take advantage of. A closer look at these Strong Reactors reveals how important this sector is to the future of the economy. Strong Reactors have a similar profile to those in the Credit Crunch years; it’s not a good time to be young or have a young family. Strong Reactors are most likely to be 25-34, with school aged kids. The Unaffected, by contrast, are concentrated in the upper age regions (particularly 65+). Strong Reactors have seen their income reduced markedly, either through job loss or furlough. They are also more likely to be found among under 44s, living in London/South East and among ethnic minorities. Naturally, Strong Reactors are particularly anxious; more than half (53%) say they are extremely or very anxious vs 26% among the rest of the population. This anxiety has become somewhat consuming for them too, with significantly higher levels compared with our other groups shown around job loss, rising unemployment, going out shopping. Generally higher, too, with concerns about loneliness, isolation, not going out and lack of exercise / training. redundancy will be less sought after and it’s likely that the young will increasingly feel compelled not to follow creative pathways but take the route of stability in a world that now presents so many uncertainties.

% UNAFFECTED % PLANNERS (CUTTING BACK JUST IN CASE) % SOFT REACTORS (HAVING TO MAKE SMALL CHANGES) % STRONG REACTORS (STRUGGLING FINANCIALLY)

Shopper Trends No.51 | StockTake 2021

Generation Change How the youngest generation’s shopper behaviours are being shaped by the pandemic Figure 1: Decline in top-up shopping in 18-24 year olds 2020 JAN 2020 DEC

% %

I do a regular large main shop, and try not to top up in between

46 I do a regular large main shop, with top up shops in between

I do lots of small shops, rarely / never doing a main shop

2020 was a year of change for everyone - and 2021 is showing few signs of quickly going back to the normal that is now a distant memory. Some might argue this change has been the biggest for the younger generation, our data certainly does. This was the generation who were eating and dining out, socialising with friends and planning spontaneous events. The younger generation was also the age group who relied on frequent top-up and impulse trips, popping into the shops to buy something for dinner on the way back from work, or for special occasions and treating missions. This has had to change.

Shopper Trends No.51 | StockTake 2021

Figure 2: Changing behaviours in the younger generation compared to pre-coronavirus times:

34% are cooking more from scratch

23% have started or are doing more batch cooking

Written by Jasper Darby jasper@shoppercentric.com Our January 2020 Stocktake data showed that 16% of 18–24-year-olds shopped by doing regular small top-up shops. However, this has now shrunk by 75% to a mere 4% ( See fig. 1). This younger age group has had to significantly change its behaviour throughout the pandemic. It’s had a psychological impact too: the data shows that 36% of 18–24-year-olds are feeling ‘extremely’ or ‘very’ anxious/distressed. This is 11 % higher than the average of all age groups. It is fair to say that the younger generation is having to adapt the most. On top of needing to change their social behaviour, news reports show that university students are going through the turmoil of studying in isolation from their peers. Being unable to attend university lectures and seminars is having a detrimental effect on many students’ mental health. Some are even unable to stay in the accommodation they are paying for, so it is no surprise that their claim of feeling anxious is higher than the total sample.

Most likely age group to have started doing more home baking

What does this really mean? How changed is this generation? How far have they been stretched? Will they have the ability to bounce back to how things once were? Or have they been pushed to a point where new behaviours will stick? There is evidence to suggest that this forced change in behaviour has led to an uptake in new hobbies such as scratch and batch cooking. See fig 2. It’s easy to think high anxiety is the norm for all younger shoppers. However, 54% of younger shoppers say, “I’m enjoying my life routine at the moment”. Although times have changed for our younger age group, over half of these people aren’t finding it too bad. Our qualitative conversations with shoppers confirm that the initial desperate desire to do currently prohibited things has gradually been replaced by a growing appreciation for the smaller, more essential things in life: such as walking and being outside, picking up and playing a guitar for the first time, spending more time with family, or even becoming more organized. These are all contributing to helping some of our younger cohort feel more content.

Shopper Trends No.51 | StockTake 2021

So, how good does TikTok taste? Could the digital age help feed the nation’s appetite? Figure 1: More consumers are now cooking and baking than before the pandemic Never done this before, but I do now

Doing this more now

Doing this the same as before

Doing this less now

Don’t do this and never have

62% 54% 44% 33% 24% 8% 2%

24% 12%

10% 4%

Cooking from scratch

2% Cooking/eating healthy meals

17%

3% Home-baking (e.g. cakes, biscuits, bread)

Figure 2: Takeaways for home delivery and collection are still increasing 29% 33% 42% Takeaway – Click & Collect

45% 48% 56% Takeaway – Home Delivery

Shopper Trends No.51 | StockTake 2021

May 2020 June 2020 Dec 2020

Written by

Kristen Davis

kristen@shoppercentric.com

While often borne out of lockdown necessity, the surge of scratch-cooking in Britain’s homes has cemented a new skillset that looks set to continue. In fact, our latest figures show yet another increase in the ‘real meal’, with 35% of people now cooking from scratch more than before the pandemic. The reasons why have been well documented here and elsewhere, not least having fewer or no opportunities to eat out creating a drive for more resourceful, well-planned and varied dishes being served at our tables. But what happens when you can’t face another homemade lasagna or chicken katsu knock-off?

TikTok sends me recipes, I flick through them while I’m watching TV and save the ones I like Short of calling in other members of the household to take the reins, some main cooks are looking in more creative spaces for snappy, tasty ideas for baking, batch and scratch cooking. TikTok, Instagram and Pinterest, while not top of mind for many of us, are burgeoning platforms for enthusiasts who want the ideas fed to them - not the other way around. You see; hunting through recipe books or logging on to a website can be as much work as the scratch-cooking itself. Our short attention spans and constant need for stimulation suggests we need cook-hooks, not cookbooks. TikTok and other platforms do just this. They ‘push’ easy, quick, beautiful, tasty solutions to help us do our job better and this openness to incoming messages also presents an openness to branded products that make it happen. Could your product be a cook-hook?

But let’s be clear, it’s not all about elevating one’s digital ‘bytes’ – the dial-in bites are just as important. Takeaways have been on the up since Lockdown no. 1 and are still increasing! In fact, better coffee, better crisps, and better brands have all been quoted as new food goals for our shopper community. When cooking is an everyday event, and healthier choices have more top of mind implications in our new coronavirus world, then every mouthful counts in a more meaningful way. While we are not seeing a wholesale shift away from snacking, we are seeing a move towards more mindful, best-I-can-afford, enjoy-what-Icook shopping and consumption mindsets. For example, more fresh-snacking from the fridge, more plant-curious shoppers and less red meat on the dinner table exhibit this more conscious move to eat foods that serve us well. Sandwiches continue to decline too, with hot lunches making headlines over winter, but also because we often have a wider meal choice at home. Of course, key workers have never left the bustling streets and many will return to office work, but the clear and stated intent for those who have the choice, is to lead a more flexible working life. More working from home means closer proximity to the fridge and more time to enhance those freshly sharpened cooking skills.

I’m just so bored with everything, bored with my food, my cooking, what I’m wearing. My life is on the repeat cycle ‘Back to the future’ perhaps sums up the direction our cooking habits are heading? Simple, tasty, real food dishes inspired digitally, delivered remotely and cooked personally. We think TikTok might be quite a tasty recipe, after all.

Shopper Trends No.51 | StockTake 2021

To treat or retreat?

Photo by Vojtech Okenka from Pexels

How important is spoiling ourselves in this complicated new world we live in?

39%

of shoppers have cut back on sweet treats to save money 0

Shopper Trends No.51 | StockTake 2021

100

Treating is very important but quite what it looks like depends on who you talk to and what our shared restrictions have meant for them personally. Treating has taken on a broader, and in some cases, a simpler definition than it may once have had. Savouring our last chocolate biscuit or favourite ice cream flavour is now rubbing shoulders with a precious phone conversation with a young grandchild or the arrival of a long-awaited sofa for more comfortable ‘surfing’. What’s more, for many, our COVID times have triggered a lifestyle reset with what we eat, how we sleep, where we exercise and how we socialise, all up for review. Written by

Sarah Lacey

sarahl@shoppercentric.com

Anxiety levels are a good predictor of food-led treating patterns – to a point. 53% percent of our more worried shoppers (vs. our average shoppers at 39%) agree they have cut back on sweet treats as they tighten their monetary belts. A similar trend is seen with 62% of our anxiety-prone shoppers (versus 44% on average) agreeing that less indulgence is a good thing, as they try to avoid loosening their real belts any further than they already have. If we continue along this ‘volume’ theme, we also see 54% of our more anxious shoppers diligently stocking their freezers more than usual, leaving little space for the puddings and ice creams of the old world: only 34% of our less anxious making the same decision to stock up in the face of uncertainty.

But like many things, it would seem treating too can divide a nation, with the average effort to curb the Covid bulge decreasing from the first lockdown to the end of 2020. Our 25-34 year olds are trying hardest not to over indulge. This is likely to be a combination of both pride and purse strings pulling at patterns of purchase behaviour. So, while there is a more general sense of embracing the need to treat, we have heard plenty of shoppers talking about their long-term health goals and the role we each now need to play in eating better to live better. For us, this points toward more than needing a ‘moderation mantra’, because genuine enjoyment is paramount – otherwise why bother, right? This also indicates that products and brands that avoid a hard line on good and bad, and instead create space for better choices not perfect choices, might shape the right kind of curve for both shoppers’ waistlines and businesses’ bottom lines.

Shopper Trends No.51 | StockTake 2021

Written by

Sarah Banks sarahb@shoppercentric.com

Shopper Trends No.51 | StockTake 2021

Who loses when online wins?

Changing dynamics in grocery shopping It won’t be news to anyone that the pandemic has fast-tracked uptake of online grocery shopping, with 7 in 10 shoppers now buying some groceries online each month.

52%

55% 57%

Figure 1: Increasing online sales since the start of the pandemic June 2020

May 2020

29% 30%

34%

16%

Groceries online for delivery

Dec 2020

Groceries online for collection

19%

22%

Online order direct from brand/ manufacturer

Shopper Trends No.51 | StockTake 2021

Who loses when online wins? continued...

From a stable five-year base of 11% pre-Covid, the proportion of shoppers saying they most often go online to buy groceries shot up to 17% during lockdown no. 1 - and has remained there ever since. The proportion of grocery spend going online is still growing; 37% of online shoppers now source at least ¾ of their groceries digitally (up from 31% in lockdown no. 1). Although fear and the desire to stay away from any potential source of coronavirus infection was the initial motivation for many making this switch, it is clear that online ‘Lockdown Newbies’ have been won over by the convenience of clicking and receiving shopping without leaving their homes; 90% of them intend continuing with online shopping to one degree or another post the pandemic. That’s not to say that some shoppers haven’t been pining for the experience and enjoyment of shopping in ‘real’ shops.

This has been no ordinary move online The ongoing battle for available online shopping slots has meant shoppers can’t always remain loyal to their bricks and mortar retailer. For example: amongst ‘most-often’ Asda bricks & mortar shoppers in Dec. 2020, 23% were new to Asda physical stores and whilst there were no ‘newbies’ to Asda online, a further 9% were new to a different online retailer other than Asda. Loyalty? Not since the pandemic! For all retailers, a kind of musical chairs has been taking place with their shopper base - with new shoppers coming and leaving again. They need to keep a keen eye on where this nets out – or proactively choose to steer it. From a retailer’s perspective this represents an opportunity to win over a large influx in new shoppers and a risk of permanently losing loyal shoppers by doing nothing.

Figure 2 65+ online shopper group has doubled

Shopper Trends No.51 | StockTake 2021

Figure 3: ‘Most-Often’ grocery retailer NETs by channel (%) 70

PrePandemic

62 59

PrePandemic

Post Pandemic

NET: Bricks & Mortar Major Mults

17 17 18 11 10 11 11

PrePandemic

Post Pandemic

NET: Discounters

Contrary to ‘traditional’ patterns of digital growth being greatest amongst the young, uptake of online grocery shopping this time has been fastest among the 65+ year old group – more than doubling through 2020. In one category we studied, almost 4 in 10 Lockdown Newbies were over 65. This older generation of online shoppers have not necessarily found the move online easy; Website UX can be confusing at the best of times. Retailers who take the opportunity to cater for the needs of this new online generation may earn themselves a loyalty windfall as the COVID-19 dust starts to settle.

So who’s the ‘biggest loser’ in all of this? Despite final quarter positive trading results for the multiples, it is clear from our data that largeformat bricks and mortar stores have been most affected by the fallout from COVID-19 (see fig. 3).

Dec 2020

June 2020

21 22 21

May 2020

Jan 2020

22 22

2019

49 48

2018

2016

Post Pandemic

PrePandemic

6 5 4 5 Post Pandemic

NET: Online Grocery Retailers

PrePandemic

7 7

Post Pandemic

NET: C-Stores

This is despite being the traditional go-to channel for main shop missions, which have gained significantly in importance overall. Online shopping is now fulfilling many of these main stock-up shops, whilst many shoppers have rediscovered local independents and convenience formats for any top-up needs. Discounters, with their smaller ranges, narrower aisles (and perceived difficulties with social distancing) have struggled to fulfil more fearful shoppers’ needs to do the whole shop in one store. Although the whole grocery channel has benefitted from picking up those Out-of-Home missions no longer taking place, we predict that once social normality returns and we find ourselves taking the full financial hit of the pandemic, discounters will likely bounce back and it will be large-format bricks and mortar stores that are left struggling for footfall.

Shopper Trends No.51 | StockTake 2021

Written by

Marie Screene

marie@shoppercentric.com

Are Shoppers More Planned in their Behaviour? Or is there more opportunity to drive impulsive behaviour? On the face of it, the evidence strongly points towards a resounding ‘no’ as shoppers appear to be more clinical in their shopping styles: conducting larger, more heavily planned shops at lower frequencies. 11 61

7 37

57 28

6 45

6 51

Figure 1: Split of shopping missions pre-, during and and post-Lockdowns 2020 (%)

Mostly small shops Regular large main shop, with top-up shops Regular large main shop, and try not to top-up

2016

2017

2018

2019

Jan 2020

May 2020

June 2020

Dec 2020

Shopper Trends No.51 | StockTake 2021

It is only recently that we have written about the perpetual top up shopper which has upwardly trended since the 90s and now we have seen a complete U-turn of this 25+ year journey. We have seen a 60% increase in a ‘main shop only’ approach and a 60% decrease in ‘small shops and rarely / never doing a main shop’. Shopping patterns are not what they were. At the start of the pandemic, we observed the ‘main shop only’ mission increase from 27% to a massive 57% of chosen shopping styles. Although this has slipped back to 43%, it indicates that whilst shoppers are edging back towards pre-COVID-19 trends, there is some way to go. Until hectic ‘life routines’ re-emerge around school and work, the larger missions are here for a bit longer. There is one type of shopping mission that we have seen decrease as a preferred way to shop. Back in January 2020, 17% of shoppers claimed that they completed ‘small shops only’. Since March 2020 it remains at just 6%. To understand the essence of these shopper missions, we have conducted in-depth interviews throughout the pandemic to help us understand some of the motivations. Whilst shoppers articulate that they are more planned, this does not necessarily translate into fewer stores being visited, and planning can be disrupted: I do prefer to shop online now because it’s safer. But it’s difficult to get a slot and when I do, I often get substitutes or something’s missing, so I have to go to a shop anyway. Planning can result in more shops visited as our heightened sense of community also comes into play, with the relatively unaffected (financially) wanting to support local communities and businesses: I do a lot more Click & Collect from the supermarkets, to leave slots for people who need them. I prefer not to go into those types of shop, but I do want to support local businesses. So, I use social media to find them and check them out. I do it all early in the morning, before it gets busy.

And don’t forget, if you live in the right place online shopping doesn’t require planning: Deliveroo – I can get stuff from Sainsburys, Asda, the Coop, Waitrose in 15 minutes. The other night I was making pizza and realized I’d not got enough mozzarella and some other bits. I had them with me in less than 20 minutes, faster than going myself! Shoppers’ behavioural scripts are disrupted because of influences both inside and outside the store. Inside, shoppers maybe navigating in unfamiliar stores, avoiding other shoppers, following one-way systems and going through cleaning regimes. Outside the store, household consumption changes drive the need to consider more meals, new ways to snack and support scratch cooking. Each alone does not sound profound, but cumulatively they all add to the cognitive load on the shopper. In turn, this raises levels of cortisol and adrenaline resulting in narrower attention and a detrimental impact on decision making and memory. We have all been there: stood in the middle of a supermarket, not quite sure which way to turn and frozen trying to decide where to go next. As shoppers are using the stores in a re-purposed way, to really facilitate spontaneous (and pleasurable) shopping they need the stores to help them navigate well in the first instance, to free up time for them to be inspired to fulfil their newer consumption needs.

There is also a large cohort of shoppers out there, for whom going into physical shops and being able to wander, interact and make spontaneous things, is their way of preserving sanity for the moment. After all, when it is one of the few places you are allowed to go without breaking rules, why not?

Shopper Trends No.51 | StockTake 2021

What is Loyalty Anyway? Health issues around loyalty highlights the overarching impact that habit can hold.

Shopper Trends No.51 | StockTake 2021

We all know the adage that loyal customers are more profitable. Loyal retail customers shop more often and tend to spend more when shopping, which is all good news if you are the chosen ‘one’, but not so great if you are carrying many secondary shoppers who are perpetually repertoire shopping. Even though repertoire shoppers (of stores) tend to bring regular income, it is more difficult to encourage an increase to the size of their basket and draw in more expenditure from elsewhere.

Written by Jamie Rayner jamie@shoppercentric.com

Figure 1: Average number of retailers visited in past month

5.5

Pre-pandemic

4.8

4.1

January 2020

May 2020

It seems common sense that larger shopping missions would reduce the number of stores visited in a month and thus drive down store repertories. On the contrary, our research highlights that the number of retailers used (online or offline) in the last month has in fact gone up by around a 1/3rd since the start of the pandemic. As a nation, we now shop on average, around 5.5 retailers per month vs just 4 back in January 2020. Where we shop is no longer so clear cut.

June 2020

December 2020

New factors have affected that old reliance on customers returning to a familiar store. This is no longer a simple solution: store choice widens and, as a result, loyalty continues to be undermined. So, what is happening? If we check the magic five factors that impact on store choice and loyalty: price, quality, service, convenience, and assortment – and then review each factor, we can immediately identify several issues that capture what is different compared with this time last year.

Shopper Trends No.51 | StockTake 2021

What is Loyalty Anyway? continued...

During Lockdowns 1&2

1 in 3

Stopped or avoided using a retailer

4 in 10

Tried a new retailer for the first time ever

For example, ‘quality’ has been pressure tested; many shoppers are not used to forward-buying fresh produce for a month at a time and have discovered how long their fresh produce keeps fresh. For some this is very negative, others have been pleasantly surprised. Service provided by store colleagues has been stretched to the limits from managing panic-stricken buyers desperate to get that last bag of flour; to picking the shelves to fulfil a surge in online orders; to just pure operational challenges around absenteeism and managing hygiene processes. For many, the online environment has provided a new lens through which to evaluate the quality of service from the retailer. Ranges that were not under scrutiny before have been tested by new shoppers in new categories pursuing recipes for scratch cooking, batch cooking or the next home-baking experiment. Logic dictates that if shoppers were truly satisfied with all elements of their shop and the products they were buying, we surely would expect to see a net decrease in the number of stores used vis-à-vis the vast number of restrictions in place. This increase in store usage and apparent lack of loyalty demands store drivers be reviewed. As we revert to a world of freer movement how will retailers retain the baskets that they have gained in the online space and encourage the same shoppers to come back to their main estates? With 4 in 10 shoppers trying a new store in each lockdown and 1 in 3 stopping or avoiding the use of a particular store, there is the potential for further disruption as further quality and value seeking behaviours come to the fore under increasing fiscal pressure. We already know that younger shoppers, those that are most anxious and those most fiscally impacted have the widest repertories of stores [figure 2]. Typically, as shoppers seek value, they become less loyal to a particular supermarket, which puts further strain

Shopper Trends No.51 | StockTake 2021

Figure 2:

on the relationship between supermarkets and their primary shoppers. There is a real opportunity to understand how to build loyalty with the most affected, younger shoppers.

Average number of stores visited in a month to December 2020

BY AGE 18-24

6.5

25-34

6.5 5.7

35-44

5.1

45-54 55-64 65+

4.5 4.8

BY ANXIETY LEVEL Extremely anxious

6.8

Very anxious

6.0

Quite anxious

5.6

Slightly anxious Not at all anxious

5.3 4.5

Strong Reactors

5.9

Soft Reactors

5.9

Planned

6.0 4.6

Certainly, locational loyalty (convenience) continues to challenge true loyalty to a retailer because of the value equation. As habits and daily routines (re)form there may be a return to previous retail outlets, but this is unlikely to settle as it was before. Other disruptors such as D2C service from a brand (over 1 in 5 shoppers have used this service) could disrupt and introduce different levels of service expectations from retailers. Reviewing the new customer base, understanding what their expectations are, would be a good place to re-create the value equation required to drive future loyalty. Price alone - which was used as a blunt tool by some in the last recession - is highly unlikely to be the answer. Paradoxically it can become a costly, misplaced pursuit.

Who am I loyal to? Whoever I can get a slot from!

BY FINANCIAL IMPACT

Unaffected

I’m shopping at Asda and Morrisons online, topping up at Tesco, Sainsbury’s and Jack’s. I’m trying to spread my spending.

The fact that there is so much interchangeability at play between retailers highlights a wide-open opportunity for retailers to do something (different or better?) that drives shoppers back to their stores. Our qualitative investigations also reveal a more basic truth: Now is the time to do something.

Shopper Trends No.51 | StockTake 2021

New Approaches:

Shocks & Switches: We take a look at how we understand if changes are here to stay. Written by Jon Darby jon@shoppercentric.com

Brand owners (retailers and manufacturers) really want to know if these changes are here to stay. At Shoppercentric we have developed a way of reviewing behaviour to determine ‘stickiness’. We know that typically, shifts in behaviour take longer than envisaged, even when tech is there to enable. We also know, however, that changes happen more quickly when ‘shocks’ are introduced to a system. For example, 14 years of rationing during and beyond World War II forced a shift in the nation’s relationship with food and created deeper, more cultural changes within society. It is widely reported that this brought a sense of sharing, co-operation, and community. Fast forward some 75 years, and as VE Day celebrations became a distraction in the early days of the pandemic, we witnessed new seismic changes in how food and drink were acquired

and how they played out very quickly. There was certainly a sense of community that emerged, and our research captured that 4 in 10 shoppers had received deliveries via friends and family (up from a more usual c. 1 in 6). However, the big story, was that Online grocery shopping took from 1996 to March 2020 to grow to c. 7.5% but doubled over just the next three months. This was not necessarily a simple switch for many shoppers as just under half tried but failed to buy groceries online. Whilst one third of all shoppers persisted and were eventually successful, 1 in 10 have not tried again. These large changes in behaviour are of course the most interesting and disruptive. Pre-Covid19, the main shopper & brand toolkits used over the years have been designed to persistently ‘nudge’ shoppers, driving subtle changes, to increase sales by doing things such as reducing complexity, reducing uncertainty (of choice), reducing clutter and facilitating the shopper’s ease of choosing one brand over another.

Shopper Trends No.51 | StockTake 2021

SWITCH

gi n

e pp

oice annel ch g. ch e r iou av

SCREE

NIN

S FAC T I

IP CR

CORE SHOPPER BLUEPRINT

SHOCKS

Shopper Trends No.51 | StockTake 2021

New Approaches:

Shocks & Switches continued...

Post-Covid19, or any other big shock for that matter, the actions to drive change might be the same and the questions to help understand might be similar, but big new opportunities and threats can appear and disappear: backing the right horse can be as lucrative as backing the wrong horse can be costly. Post-Covid, the features we know and understand will still be relevant. After all, at a basic scientific level, nothing has changed about the way in which people choose. But what our model shows is how this mix of factors come together slightly differently. The shopping challenge now, for example, is not so much about reducing complexity in store as much as it is about reducing anxiety: shoppers are more conscious of time constraints and of meeting certain imperatives. This is another kind of decluttering, but it is motivated differently – it is not about making the environment simpler to be a more efficient ‘navigator’, it is about reducing cognitive load so shoppers feel safer and confident that they can accomplish missions. Understanding these nuances leads to better decisions, creating a more relevant outcome. Our behavioural scientists get excited on hearing about change as the external (shock) factors that we observe force us out of system 1 and into system 2 decision making. As a result, many shoppers change their shopping style (our behavioural blueprints to shopping) and a new repertoire of scripts are re-written. New repeatable behaviours emerge to reduce the otherwise would be, cognitive load.

Six Behavioural Elements There are six core elements to our behavioural change model which is designed to better predict shopper behaviour. ‘Shocks’ (in this instance, Covid19) can disrupt both styles of shopping and the scripts that support them leading to a potential change. The model is not restricted to COVID-19 but any shock and disruption that a shopper is introduced to. It could be an out of stock for the third time or equally recessionary impact. The key factors in the model are the following: l Most decisions are preconscious, the

consequence of screening out and rejecting options. This is system 1 in action, which we typically understand by breaking down decision making via our research techniques we have developed.

l Acting consistently in terms of a style or following

existing scripts also functions system 1.

l Styles are more predispositions and attitudinal

– they can be a basis for segmentation.

l Scripts are more behavioural and involve

following a plan which typically depends on learned, social or cultural knowledge – a shared repertoire.

l Switching styles or scripts is deliberative -

system 2 kicks in, albeit reluctantly. This involves significant cognitive effort. In the Covid19 context it is motivated by the need to reduce anxiety, and perhaps to save time in-store.

l The level of satisfaction with the change that

has been made is the final determinant within the model to understand stickability.

Shopper Trends No.51 | StockTake 2021

Figure 2: Illustration showing how shocks can induce switching in behaviour

STYLES

SCRIPTS

SWITCH

STICKINESS

YES

NO CHANGE

YES

SIDESTEP

READJUST

YES

PIVOT

FULL RESET

SCREEN (FRAME)

YES

EFFORT

SHOCKS

YES

SATISFACTION

Measuring Stickiness Our 6S behaviour change model has a wide application across brand, category and innovation teams. It not only qualifies the nature of behaviour change but also quantifies the level of satisfaction with any willing or forced switches. Of course, not all changes will be sticky, but our collective job as marketeers is to understand which factors are sticky and to confidently know ‘who’ has changed, ‘why’ the change, ‘how often’ and how ‘happy’ they are with the switch they have made.

Critically, while 6s is not a crystal ball, it does allow our clients to identify, define and evaluate customer momentum in the context of their product and brand worlds. This all-important direction of travel is the foundation for successful future planning and the difference between a sticky behaviour and getting stuck in a rut.

Shopper Trends No.51 | StockTake 2021

An Expert’s view

Great Balls of Fire Peter Corijn is currently CEO of Vucastar (www.vucastar.com), a consultancy focused on Ensuring Mission Success. Before, Peter was global CMO at Imperial Brands and Vice-President at P&G. He was senior advisor at McKinsey.

By Peter Corijn || Paul Numi

I am two people: business executive and indie rock artist. I have had a chance to experience both the world of FMCG and the music industry.

Find Paul Numi’s latest album ‘Chimera’ on Spotify by scanning the link above. Paul Numi is an indie rock artist, inspired by the sounds of the 80’s. At the start of that decade, he was very active in music supporting the likes of U2 and Echo&the Bunnymen. Then, life took another turn. In 2020, he released his come-back “Chimera” album (Spotify, YouTube, Deezer, AppleMusic). The album has already hit more than 125,000 streams and views. For Cd’s and T shirts: contact@paulnumi.com Instagram: paul_numi

Certainly, COVID-19 will have a lasting impact on FMCG companies. For starters, with the forced closure of shops, everybody has been made comfortable with buying on-line. Even laggards now shop digitally. The music industry experienced it much earlier and has been in turmoil for decades. Napster appeared in 1999. Apple took advantage of that strategic inflection point with the launch of the i-pod in October 2001. By now we have experienced another breakthrough with streaming sites (Spotify, Deezer, Apple Music). Many people do not even have a CD player anymore. The i-pod is long gone. The i-tunes app is now shut down as well. Vinyl is making a modest come-back. I have recently indie released my “Chimera” album after a long break from music since the 1980’s. The learning curve has been steep. Here are some key lessons that can cross-fertilize:

Shopper Trends No.51 | StockTake 2021

What can FMCG learn from the music industry in the post-COVID world?

The Medium is the Message; your brand design may need to start with digital, not the store. Take sleeve design: the brilliant cover of The Beatles’ “Sergeant Peppers” does not work as well in the digital environment. Simply because the design is too complex. On digital sites one only has a couple of square centimetres to make an impact. Compare that sleeve to the one from The Red Hot Chilli Peppers, designed for the digital world. Indicated FMCG Action: l Rather than designing for a supermarket

shelf, start with digital. It’s essential to check if packaging works on line first.

l Simplicity in design is recommended.

continues....

Shopper Trends No.51 | StockTake 2021

An Expert’s view What can FMCG learn from the music industry in the post-COVID world?

Storytelling becomes more important; constant engagement is the name of the game: A week in the life of the indie artist: every 2 to 3 days, a high quality, new picture must be posted on Instagram and Facebook. It’s essential to get and keep followers. However, one can only so often put a picture waving a guitar. That gets boring. What is required is storytelling, new angles to the “brand equity”. This also means that it is no longer recommended to issue an album in one go. Since constant “news”, is needed, it is better to release 3 or 4 singles every 12 weeks and only then to issue the full album. Indicated FMCG Actions: l An engagement plan is needed with constant

news. Plan the ad production accordingly.

l Develop stories for your brand. Your agency

must be storytellers first and foremost. Remember that digital consumers need to want to see your message.

Experiment: create a culture of trial and error. In truth, nobody really knows how some of the digital platform logarithms work. How then do I know where to put my (limited) funds to push my music vids or to get onto playlists? The way to handle this is to create lots of ads or options, test them cheaply and then roll-out what has impact. You can do the same on Instagram stories. There’s little risk anyway because a story only holds for 24 hours. Indicated FMCG action: l Develop a test and learn plan for every initiative.

Make “spend a little, test a little, learn a lot” part of the culture.

Be everywhere, all the time. As a consequence, use more open-source production to massively reduce production costs.

l Appoint content managers. l Spread the initiatives. Instead of a big bang

only “launch and leverage”, make a plan that reveals different angles of the innovation over an 18-month period.

l Does your packaging tell a story?

In music, just like in media in general, there is more and more fragmentation. But if one needs constant engagement everywhere, how to make sense of the extra cost and effort? One way is to reduce production costs in favour of media investment. All sorts of support options are available. Fiverr is open source and people can develop a lyric video for 50 Euros. Why use an expensive photographer when there is Shutterstock? Make pictures or videos with a smart

Shopper Trends No.51 | StockTake 2021

phone. Open-source development is available for just about anything; 99designs.com for instance. At least, check these options first. Better still: have consumers develop content. One of my relationships gifts is a Paul Numi t-shirt. There is one condition: post a picture of yourself wearing the T on social media.

Authenticity matters more than ever. As an artist, I do not hide the fact that I’m bald and a “not so young youngster”. My image, music and lyrics reflect that. Anything else would be ludicrous and utterly unbelievable.

Indicated FMCG Action:

In a crisis, and its aftermath, authenticity carries great value for brands too. Why? Because trust comes at a premium.

l Experiment with cheaper production options.

Indicated FMCG action:

l Use more open-source development.

l Find what you can do to drive authenticity. Stay

l Can your consumers create content? How?

Remember: participation is a strong loyalty driver.

l Start to accept the 80 / 20 rule in production

values (although there are some exceptions here, such as luxury brands).

Stand out: simple, consistent, different and to the point. Nothing new, but it is more important than ever. Spotify gets 40,000 new song releases... every day. TikTok has a lot of videos limited to 15 seconds. Attention spans get shorter and shorter. Indicated FMCG Action:

authentic, avoid pretence.

There are many more COVID-19 learnings of course and they differ per industry. 51% of Fortune Top 500 CEO’s believe that business travel will never go back to where it was. Horeca and Leisure Travel will experience a boom when the restrictions are lifted. Positive messages will work better after all the doom and gloom. Working from home will be more accepted. And yet, some things will never change; the need for a well-defined positioning and in-depth consumer understanding to name but two. In the meantime, stay safe and keep on rocking.

l Be crystal clear on what the brand

stands for, who the target audience is.

l Stick with something (if it works...). l Can you develop executional

equities that are a short-cut to your brand? What is your equivalent of the Nike swoosh? The Marlboro red and white chevron? The shape of the Coke bottle?

Shopper Trends No.51 | StockTake 2021

Proud to Announce:

Client Space:

Does your research agency ensure Voices4All?

Opening up opportunity for all

Driving inclusivity in panel representation and data.

Take part in MARS’ #HereToBeHeard campaign:

The ethnic minority population of the UK is larger than the populations of Scotland and Wales combined. We routinely ensure Scotland and Wales are consciously represented in our national samples: why not ethnic minorities and other groups too?

We’re equally thrilled that we have been invited by a client of ours – MARS - to take part in their #HereToBeHeard campaign. We think this is a brilliant initiative to advance gender equality.

It’s a truism of any research that the output is only as good as the data input. Alongside questionnaire design, representation within panel samples is critical. But the typical ‘Nationally Representative’ (NatRep) sample controls that have been used for so long just don’t cut the mustard these days. Vital components in traditional sampling controls are missing, so much so that we cannot be sure every voice is heard and properly represented.

This is part of the company’s Full Potential platform for action on gender equity in its workplaces, sourcing communities, and the marketplace. #HereToBeHeard asks all people – but especially women - everywhere one question: “What needs to change so more women can reach their full potential?” All women are invited to take part and the responses will inform the concrete actions Mars will take – both within its value chain and in broader society – to close the gender opportunity gap.

We are passionate about representation and try to live an inclusive philosophy. Which is why we are incredibly proud to be a founding partner in the Voices4All movement. Voices4All is committed to including representation of diversity and inclusion standards within research services. Established in July 2020, Voices4all has the aim of creating a minimum standard for NatRep UK research samples which not only statistically reflect age, gender, region and socio-demographic breakdowns but also ethnicity, sexual orientation, and disability. If you agree this is fundamentally important for your business to make the right decisions, we’d be thrilled if you join us. For more information about the Voices4All movement, please visit www.voices4all.co.uk

We at Shoppercentric are actively encouraging all employees to participate in this research, especially our female colleagues. It only takes a few minutes to make a difference in helping more women reach their full potential. Submissions are anonymous and will not be attributed to individuals or organizations. Let your own voice be heard, along with others from around the world, by providing your input. It would be fabulous if you’d like to join us at #HereToBeHeard campaign page Findings from the study will then be shared around the globe and will inform actions, tools and initiatives designed to help more women reach their full potential.

Shopper Trends No.51 | StockTake 2021

Real words from the high street. Brought to you by the keen ears of the Shoppercentric team... At the start of all this I started to drink – a bottle of gin was in the basket every week. I started to ache, but I’ve got it under control now. I was borderline type 2 diabetes, but my cholesterol is down, I’m not at risk and I’m halving my blood pressure tablets. Covid made me stop. Now I exercise, stretch and eat more healthily.

As cheesy as it sounds you do really appreciate that life is short, especially with the death toll continuing to rise o it does make you really focus on, despite being relatively young, appreciating your family and friends and doing what you can to support them. And even like vulnerable people in your community, like my neighbours I help with their shopping.

I like to visit local shops and try to spread how I spend my money. It’s important to support the local economy, especially at times like this.

I think this year has allowed people/ me in general to focus on yourself physically and mentally all that stuff, taking away a lot of the temptations and bad habits that people have in terms of you know kind of going out and drinking and eating you know x, y, z kind of thing, it’s allowed kind of people to stop a little and you know ‘what do I need? Right let’s get back into some good habits’ I guess for me it’s allowed that time for reflection.

At the moment I’m feeling fairly secure with the money I’ve been able to save…but who knows what’s around the corner? Brexit? What’s that? That’s so far away, I can’t worry about that and the pandemic at the same time. Covid isn’t going away. We have to get used to this new normal and get out there again. I’ve discovered so many new recipes and ways of cooking, I’m not going back to how I was before. I’ve read so much more and really enjoyed it. Now I’m learning to play the guitar. I won’t take life for granted, back the I thought my life was rubbish, but actually it wasn’t that bad, I wouldn’t mind having a hangover. I’m spending more time with family, not going out, the number of deaths right now makes you think differently about how you should be doing things and taking a little bit more time with health and wellbeing. The walk a day helps to clear your mind, getting a way from your desk and work.

I think, gratitude, being grateful for your health, having a roof above your head. I don’t think I’ll complain as much as perhaps I used to about things. You know when you see the death toll rising, you just think, you know actually I am quite lucky.” – When asked ‘How have you changed? I’m organized anyway but I think I’ve been mega organized through this pandemic and I think I’ll carry that on because it does make a big difference with food spend and thinks if you plan what you’re going to eat each day. I always did appreciate stuff, but I probably appreciate stuff more. I don’t get so stressed about things. I’ve actually put in to practice my coping mechanisms and I’m probably much less stressed about things now and you know I appreciate the positives.

Shopper Trends No.51 | StockTake 2021

SPECIAL SPECIAL

ISSUE ISSUE STOCKTAKE STOCKTAKE

2021 2021

Brought to you by Shoppercentric, a full service shopper insight consultancy

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Thanks so much! The presentation went really well, some great feedback from our Board and it’s forming the basis of a lot of our plans. Head of Category, UK There is some fantastic insight delivered in this piece of work that will really help our wider teams deliver against the objectives that we set earlier in the year. This will also no doubt enhance our customer engagement at a time when digital is a key driver of all joint business plans. Head of Category, UK Manufacturer Thanks again for all of your work in this project, you are a very easy & lovely team to work with! EU Sustainability Manager

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Thanks to all of the team for the flexibility, creativity, and tenacity with which you’ve approached this. The team were delighted. Insight Manager, UK It’s been great working with you. You’re a wonderful bunch and a fantastic company. Head Buyer, UK Retailer Thanks again for the clear presentation today. As usual, very insightful, and well balanced. European Insight and Planning Manager We have recently finished working with Shoppercentric on a qualitative study using a virtual community, and I really valued the way they made the connections between the behaviour of the consumer and shopper. They had a broad range of specialists bringing different skills in at the right time throughout the project. Category Lead – UK Food Manufacturer We’ve never had any Insight like this! Buyer, UK retailer

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